London overtakes Hong Kong as world’s most expensive city for companies to situate staff

London is the world’s most expensive city for companies to locate staff (Source: Getty Images)

The strength of the sterling has made London the world’s most expensive city for companies to locate staff, overtaking Hong Kong which has held the record for five years in a row.

Research released yesterday by Savills shows that the cost of renting living and office space for one employee in the capital reached $120,568 (£73,671) in the year to June – up 5.3 per cent since January and 38.7 per cent higher than 2008 when London ranked fifth.

The rise of the pound against the dollar has helped propel London into first place, together with soaring rents fuelled by the capital’s housing shortage.

Overall, the US dollar cost of living and office space in London has increased by 39 per cent since 2008, Savills’ report showed.

In contrast, falling rents and a weakening currency has pushed the cost of locating staff in Hong Kong back down to 2008 levels.

Renting living and office space in Hong Kong for one employee cost $116,000 in the year to June, down 5.6 per cent since January.

New York and Paris were next in the league followed by Tokyo, which recorded the biggest decline since 2008 – down minus 22.7 per cent.

Savills director Yolande Barnes said subdued price growth over the last six months means currency fluctuations have produced some of the biggest changes in its rankings.